Do Wellness Programs Have a Future?

With the rising cost of healthcare and insurance, employers are looking for more creative solutions. Over the last few years, wellness programs have grown in prominence and have been embraced as a viable method for employers to encourage their employees to live healthier lives.

Wellness programs come in many varieties, including smoking cessation programs, weight loss initiatives, diabetes management programs and preventative health screenings. Many of these programs offer premium discounts, free gym memberships, cash rewards and other incentives.

So the question is, what’s the problem? Don’t we want healthier employees? After all, healthier employees have lower medical costs, user fewer sick days and tend to be more productive. And shouldn’t those employees that have lower health costs, or take actions to become healthier, be rewarded for it?

While wellness programs certainly seem to have a place in the war against rising healthcare costs, recent legal actions taken by the EEOC make it clear that employers will need to tread carefully.

EEOC Enforcement Actions

In an October 27 complaint, the EEOC challenged a wellness program implemented by Honeywell. The Honeywell program provides employees and their spouses with discounted insurance premiums and increased health savings account contributions. And the incentives aren’t small, those employees who refuse to participate in the program pay $500 more per year in health insurance premiums and can lose up to $1,500 in company contributions to health savings accounts, along with paying a $1,000 tobacco user surcharge.

In this case, the program requirements aren’t particularly onerous, but they’re not just asking employees to fill out some paperwork either. Employees must provide blood for cholesterol, blood sugar and nicotine tests, and provide height, weight and waist measurements to determine body-mass index.

Honeywell points out that the testing is entirely voluntary, with employees free to refuse without fear of losing their jobs, and provides an incentive for employees to stay, or get, healthy. Honeywell further points out that their program complies with the Affordable Care Act’s wellness program requirements.

The EEOC, on the other hand, claims that the Honeywell program violates the Americans with Disabilities Act (ADA) and Genetic Information Nondiscrimination Act (GINA). The EEOC also alleges that the program, due to the high cost of refusing to participate, is not truly voluntary.

Looking Into the Crystal Ball…

The real, burning question here is: will the EEOC succeed? With the caveat that its very difficult to predict the outcome of any legal action, I think the EEOC is going to have a difficult time proving discrimination under either the ADA or GINA.

To succeed under the ADA, the EEOC will need to prove that Honeywell’s program somehow discriminates against employees with disabilities.  If Honeywell is offering the incentives to those who agree to undergo the testing, but not basing the incentives on the results of the testing, then its hard to see how Honeywell’s actions could be seen as discriminatory. An employee that has a disability may have a more difficult time maintaining a healthy weight than an employee who is not disabled, but as long as Honeywell is not punishing those that have a higher BMI, then I think an ADA claim fails.

The GINA claim is even more difficult to make. Typically, the type of information protected by GINA involves the medical history of blood relatives. GINA seeks to prevent insurers and employers from discriminating against, for example, someone whose family history suggests a higher likelihood of breast cancer. However, in the Honeywell case, the EEOC is trying to expand GINA to non-blood relatives, specifically the employee’s spouse. I think this argument fails, because the information the employer (or insurer) might receive from the spouse’s testing has no effect on the employee’s health. It isn’t like a spouse with diabetes will increase the likelihood of the employee having diabetes. I don’t believe that GINA was meant to protect this type of information.

Stay Tuned

Keep a close eye on this topic in the news, because the outcome could have far-reaching consequences for wellness programs. Or, if you don’t feel like obsessively checking Google News for the next year, follow me, or my fellow employment law nerds (here and here), on Twitter for continuing updates.

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Casey Sipe

Casey is a management-side labor and employment attorney with Caldwell & Kearns in Harrisburg, Pennsylvania, where he writes a labor and employment law blog, The Employer's Lawyer. He loves technology, social media, soccer and bow ties. Connect with Casey.

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